Microsoft Offers Cloud Services From Data Centers Based in U.K.

(Bloomberg) -- Microsoft Corp., which has been battling the U.S. government over the privacy of customer information stored overseas, said it will offer cloud services from data centers based in the U.K.

Microsoft will sell Azure computing power and Office 365 Internet-based apps from the U.K. starting in 2016, Chief Executive Officer Satya Nadella said in London Tuesday. He also said the software maker has finished its latest phase of expansion for data centers in Ireland and the Netherlands, which serve as hubs for serving European customers.

Microsoft, Amazon.com Inc. and Google -- which have all benefited from a shift toward the cloud -- are building more data centers distributed around the globe, both to speed up the delivery of Web-based services and to contend with local laws and customer preferences for some digital information to remain in the customer’s home country or region. Microsoft is also awaiting an appellate-court ruling on a case that pits it against the U.S. government over whether Microsoft has to turn over customer data stored in Ireland.

The Redmond, Washington-based company in 2014 said it would start letting overseas customers opt to have their personal data stored outside the U.S., in response to concerns about alleged government surveillance and spying. Microsoft said corporate cloud revenue reached $8.2 billion on an annualized basis last quarter, with commercial sales of Office 365 -- the cloud version of its productivity software suite -- rising almost 70 percent in constant currency, and Azure sales more than doubling.